China's selfie app Meitu reports smaller loss in 2016

Chinese photo app and mobile phone maker Meitu Inc said annual net loss narrowed 24 percent last year, in its first earnings results since its landmark debut in Hong Kong.

Meitu, known for its popular selfie beautifying apps, on Friday reported a net loss of 540.5 million yuan ($78.5 million) in 2016, down from 710 million the previous year. Revenue grew to 1.58 billion yuan, from 742 million yuan.

Despite being known for its smartphone apps that let users retouch and beautify selfies and other photos, sales of its smartphones accounted for 93 percent of Meitu's revenue in 2016.

Xiamen-based Meitu listed on the Hong Kong market in December in a rare floatation for unprofitable companies, fetching $630 million in the IPO. That was Hong Kong's largest tech IPO in a decade.

"Investors that have been buying it up on the brand name or the sexiness of the streaming video business, when they see a big profit hit in the second half that could be problematic for the stock," he said before Meitu's results were announced.

The company said revenue from the internet and others grew 6.6 percent last year to 104.7 million yuan, while its operating loss was 652.2 million yuan.

Monthly active users grew 32 percent to a record high of around 520 million in January 2017, it said.

"We are on track to launch Pushion, our fashion-focused social e-commerce platform in the first half of 2017, adding another avenue to e-commerce monetization," co-founder and chairman Cai Wensheng said in a filing.